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Australia Raises Growth Forecast

Australia Raises Growth Forecast

Australia’s central bank raised its growth forecast for the next financial year but tipped no interest rate moves for 2017 owing to uncertainty surrounding consumer spending, AFP reported. The Reserve Bank of Australia said it expected the economy to expand 2.75-3.75% in the year to June 2018, up 25 basis points from its February forecast on expectations of a sharp increase in liquefied natural gas exports. “Year-ended (gross domestic product) growth is expected to pick up as the drag from mining investment comes to an end and the ramp-up in resource exports continues,” the RBA said in its quarterly Statement of Monetary Policy. “LNG exports are expected to continue to grow strongly over the next few years, contributing around 0.5 percentage point to GDP growth in each of 2017 and 2018.” Australia is making a rocky transition away from dependence on mining investment as an unprecedented boom ends, but the economy has so far avoided slipping into recession.